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Lawmakers, physicians call for repeal of health care law

February 26, 2019

COLUMBIA, S.C. (AP) — Some South Carolina lawmakers and doctors are trying again to repeal a state oversight program called the certificate of need, which they say puts unnecessary limits on where medical facilities can be built or expanded.

But opponents of the plan worry that repeal would do away with needed safeguards on the behavior of powerful hospitals — and supporters and opponents both say they have the best interests of rural areas at heart.

The certificate of need program requires the state Department of Health and Environmental Control to regulate whether hospitals can expand, new health facilities can be built and expensive medical equipment can be purchased.

The department’s website says the program aims to promote cost containment, avoid duplication of health facilities and services and ensure high quality services to the public. However, some lawmakers and physicians say it falls short of that promise.

A repeal bill has been submitted previously, passing in the House but dying in the Senate. The program nearly died in 2013 when Republican former Gov. Nikki Haley vetoed its $2 million in funding, saying then that such decisions were best left to the open market. The program was resurrected a year later, after a lawsuit from hospitals, when the state Supreme Court ruled it couldn’t be eliminated unless lawmakers directly voted to kill it.

The bill’s sponsor this year, Republican Rep. Nancy Mace of Charleston, said repeal would allow the market to determine what services are needed, where they are needed and the price point, important questions in rural areas. Those are all urgent issues, she said.

“We’re reaching a point where we will be closer to a heath care crisis in this country,” Mace said. “We have to ask ourselves what we can do at the state level to improve access to care, quality of care, quality of service and also find ways to reduce prices.”

“Folks who are in rural areas, in poor communities are going to have access to more services and aren’t going to have to travel as far, not going to have to spend as much money and that’s an important distinction when you’re looking at this statewide,” Mace said.

But Democratic Rep. Gilda Cobb-Hunter of Orangeburg, who represents a rural district, said abolishing the certificate of need program would be a step too far.

Cobb-Hunter said she’s not suggesting the program has no problems, but she supports the process in general because it serves as a safeguard, preventing big hospitals from doing whatever they want to do without regulation.

“I am really concerned about what it would mean for rural areas if the certificate of need was abolished. I don’t see a lot of major health care providers wanting to come into rural communities,” Cobb-Hunter said.

She also worries that without regulation, costly specialty services may be concentrated in affluent places.

Meanwhile, many physicians favor repeal.

In a letter last week to Gov. Henry McMaster, the Charleston County Medical Society said it supports a full repeal of the certificate of need program. The letter signed by 100 state physicians read in part, “Our CON law facilitates a cartel of ever-expanding hospital systems which block competitors from ever entering into the market.”

Society president Dr. Marcelo Hochman said patients lack choices, and physicians who want to provide services to those patients aren’t able to fight the “big systems.” He said rural patients would benefit from repealing the certificate of need, because more facilities could be built, preventing patients from having to travel a great distance to metro areas.

“If you’re a small group of doctors who want to set up a hand surgery center, very quickly you get outspent and you just can’t do it,” Hochman said. “Patients now have to have their breast biopsy or hernia operation at a much more expensive facility because there are no alternatives.”

The South Carolina Hospital Association is calling for the program to be reformed, not repealed. In a statement to The Associated Press, the association said it will continue to support modernizing the program and making it less onerous on the state’s hospitals and health systems.

The statement said they believe fully repealing the program would risk access in rural communities and would disadvantage border hospitals that couldn’t expand into neighboring states with more restrictive laws.

The hospital association said they have member hospitals on both sides of the issue and said they will continue to survey their hospital leaders to better understand the impact of repeal.

“We are prepared to work with the South Carolina General Assembly to reevaluate the state’s CON process recognizing advances in healthcare along with other regulatory changes in the transition to value-based care,” the hospital association’s statement said.

Mace, the sponsor, said she’s optimistic the legislation will pass this session, but said lawmakers must make a more persuasive argument to pass it in the Senate.

“There’s no better time than the time right now,” Mace said. “It’s got to go.”

The legislation was referred to the House Ways and Means committee. Mace said she expects lawmakers to take up the issue in March.

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This story has been corrected to say Mace is sponsor of the bill, not co-sponsor.

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